RAC to Look for Group 3 PWC Underpayments

Performant Recovery, the DMEPOS Recovery Audit Contractor (RAC) for Medicare, has begun to search for incorrect payments made to complex rehab technology suppliers who were paid too little for wheelchair accessories and cushions used on Group 3 power wheelchairs.

On May 18, the American Association for Homecare (AAHomecare) and The VGM Group sent out notices to the industry regarding the review.

The Group 3 power chairs involved are coded K0848-K0864, according to VGM.

“Section 2 of the Patient Access and Medicare Protection Act (PAMPA) mandates that adjustments to the 2016 Medicare fee schedule amounts for certain DME based on information from competitive bidding programs not be applied to wheelchair accessories (including seating systems) and seat and back cushions furnished in connection with Group 3 complex rehabilitative power wheelchairs (codes K0848 – K0864),” the VGM bulletin said.

“The change was effective Jan. 1, 2016, however, Medicare was unable to implement changes to the claim processing systems until July 1, 2016. During that time frame, payments were based on adjusted fee schedule amounts. The underpayment recovery will apply to claims for accessories for dates of service Jan. 1, 2016 through June 30, 2016.”

VGM gave credit for the RAC audit to Wayne van Halem of The van Halem Group.

“DME suppliers rarely experience RAC underpayments, so this is a welcome change,” VGM’s announcement said, quoting van Halem. “Many folks don’t know this, but the RACs are funded to find underpayments, in addition to overpayments and in this environment, every little bit helps.”

The van Halem Group is a division of VGM.

In its message to members, AAHomecare said, “The industry is pleased to see that Performant Recovery has been approved to add an audit that will look at the underpayment of Group 3 power wheelchair options. All wheelchair accessories (including seating systems) and seat and back cushions furnished in connection with Group 3 complex rehabilitative power wheelchairs will be reviewed regardless of modifiers. The RAC has been given approval to audit 1,000 claims at this time to gauge the reaction of the industry, and they will go from there.”

An earlier announcement from AAHomecare indicated that the RAC’s audit would focus on claims that contained a KE modifier, but an update clarified that a KE modifier requirement didn’t apply.

“This is a very positive development,” the AAHomecare bulletin noted, “as it is the first time an underpayment for our industry has been audited!”

About the Author

Laurie Watanabe is the editor of Mobility Management. She can be reached at lwatanabe@1105media.com.